Alabama Administrative Code
Title 482 - ALABAMA DEPARTMENT OF INSURANCE
Chapter 482-1-128 - GROUP COORDINATION OF BENEFITS (COB)
Section 482-1-128-.06 - Rules For Coordination Of Benefits
Universal Citation: AL Admin Code R 482-1-128-.06
Current through Register Vol. 42, No. 11, August 30, 2024
When a person is covered by two (2) or more plans, the rules for determining the order of benefit payments are as follows:
(a)
1. The
primary plan shall pay or provide its benefits as if the secondary plan or
plans did not exist.
2. If the
primary plan is a closed panel plan and the secondary plan is not a closed
panel plan, the secondary plan shall pay or provide benefits as if it were the
primary plan when a covered person uses a non-panel provider, except for
emergency services or authorized referrals that are paid or provided by the
primary plan.
3. When multiple
contracts providing coordinated coverage are treated as a single plan under
this chapter, this section applies only to the plan as a whole, and
coordination among the component contracts is governed by the terms of the
contracts. If more than one carrier pays or provides benefits under the plan,
the carrier designated as primary within the plan shall be responsible for the
plan's compliance with this chapter.
4. If a person is covered by more than one
secondary plan, the order of benefit determination rules of this chapter decide
the order in which secondary plans benefits are determined in relation to each
other. Each secondary plan shall take into consideration the benefits of the
primary plan or plans and the benefits of any other plan, which, under the
rules of this chapter, has its benefits determined before those of that
secondary plan.
(b)
1. Except as provided in Paragraph 2., a plan
that does not contain order of benefit determination provisions that are
consistent with this chapter is always the primary plan unless the provisions
of both plans, regardless of the provisions of this paragraph, state that the
complying plan is primary.
2.
Coverage that is obtained by virtue of membership in a group and designed to
supplement a part of a basic package of benefits may provide that the
supplementary coverage shall be excess to any other parts of the plan provided
by the contract holder. Examples of these types of situations are major medical
coverages that are superimposed over base plan hospital and surgical benefits,
and insurance type coverages that are written in connection with a closed panel
plan to provide out-of-network benefits.
(c) A plan may take into consideration the benefits paid or provided by another plan only when, under the rules of this chapter, it is secondary to that other plan.
(d) Order of Benefit Determination. Each plan determines its order of benefits using the first of the following rules that applies:
1. Non-Dependent or Dependent.
(i) Subject to Paragraph (ii), the plan that
covers the person other than as a dependent, for example as an employee,
member, subscriber, policyholder or retiree, is the primary plan and the plan
that covers the person as a dependent is the secondary plan.
(ii) If the person is a Medicare beneficiary,
and, as a result of the provisions of Title XVIII of the Social Security Act
and implementing regulations, Medicare is both (I) secondary to the plan
covering the person as a dependent; and (II) primary to the plan covering the
person as other than a dependent (e.g. a retired employee), then the order of
benefits is reversed so that the plan covering the person as an employee,
member, subscriber, policyholder or retiree is the secondary plan and the other
plan covering the person as a dependent is the primary plan.
2. Dependent Child Covered Under
More Than One Plan. Unless there is a court decree stating otherwise, plans
covering a dependent child shall determine the order of benefits as follows:
(i) For a dependent child whose parents are
married or are living together, whether or not they have ever been married:
(I) The plan of the parent whose birthday
falls earlier in the calendar year is the primary plan.
(II) If both parents have the same birthday,
the plan that has covered the parent longest is the primary plan.
(ii) For a dependent child whose
parents are divorced or separated or are not living together, whether or not
they have ever been married:
(I) If a court
decree states that one of the parents is responsible for the dependent child's
health care expenses or health care coverage and the plan of that parent has
actual knowledge of those terms, that plan is primary. If the parent with
responsibility has no health care coverage for the dependent child's health
care expenses, but that parent's spouse does, that parent's spouse's plan is
the primary plan. This item shall not apply with respect to any plan year
during which benefits are paid or provided before the entity has actual
knowledge of the court decree provision.
(II) If a court decree states that both
parents are responsible for the dependent child's health care expenses or
health care coverage, the provisions of Paragraph (i) shall determine the order
of benefits.
(III) If a court
decree states that the parents have joint custody without specifying that one
parent has responsibility for the health care expenses or health care coverage
of the dependent child, the provisions of Paragraph (i) shall determine the
order of benefits.
(IV) If there is
no court decree allocating responsibility for the child's health care expenses
or health care coverage, the order of benefits for the child are as follows:
I. The plan covering the custodial
parent.
II. The plan covering the
custodial parent's spouse.
III. The
plan covering the non-custodial parent.
IV. The plan covering the non-custodial
parent's spouse.
(iii) For a dependent child covered under
more than one plan of individuals who are not the parents of the child, the
order of benefits shall be determined, as applicable, under Paragraphs (i) or
(ii) as if those individuals were parents of the child.
3. Active Employee or Retired or Laid-Off
Employee.
(i) The plan that covers a person as
an active employee that is, an employee who is neither laid off nor retired or
as a dependent of an active employee is the primary plan. The plan covering
that same person as a retired or laid-off employee or as a dependent of a
retired or laid-off employee is the secondary plan.
(ii) If the other plan does not have this
rule, and as a result, the plans do not agree on the order of benefits, this
rule is ignored.
(iii) This rule
does not apply if the rule in Paragraph 1. can determine the order of
benefits.
4. COBRA or
State Continuation Coverage.
(i) If a person
whose coverage is provided pursuant to COBRA or under a right of continuation
pursuant to state or other federal law is covered under another plan, the plan
covering the person as an employee, member, subscriber or retiree or covering
the person as a dependent of an employee, member, subscriber or retiree is the
primary plan and the plan covering that same person pursuant to COBRA or under
a right of continuation pursuant to state or other federal law is the secondary
plan.
(ii) If the other plan does
not have this rule, and if, as a result, the plans do not agree on the order of
benefits, this rule is ignored.
(iii) This rule does not apply if the rule in
Paragraph 1. can determine the order of benefits
5. Longer or Shorter Length of Coverage.
(i) If the preceding rules do not determine
the order of benefits, the plan that covered the person for the longer period
of time is the primary plan and the plan that covered the person for the
shorter period of time is the secondary plan.
(ii) To determine the length of time a person
has been covered under a plan, two successive plans shall be treated as one if
the covered person was eligible under the second plan within twenty-four (24)
hours after coverage under the first plan ended.
(iii) The start of a new plan does not
include any of the following:
(I) A change in
the amount or scope of a plan's benefits.
(II) A change in the entity that pays,
provides or administers the plan's benefits.
(III) A change from one type of plan to
another, such as, from a single employer plan to a multiple employer
plan.
(iv) The person's
length of time covered under a plan is measured from the person's first date of
coverage under that plan. If that date is not readily available for a group
plan, the date the person first became a member of the group shall be used as
the date from which to determine the length of time the person's coverage under
the present plan has been in force.
6. If none of the preceding rules determines
the order of benefits, the allowable expenses shall be shared equally between
the plans.
(e) Prior Authorization and Prompt Response to Inquiry.
1. The primary plan, with the exception of
Medicare and Medicare Advantage Plans, shall accept Medicaid's authorization
for an item or service furnished to a Medicaid eligible individual. The primary
plan cannot deny claims due to a lack of prior authorization.
2. The primary plan must respond within 60
days of receiving a state inquiry regarding a health care claim submitted
within three years of the provision of such item or service.
Rule is not subject to the Alabama Administrative Procedure Act.
Author: Commissioner of Insurance
Statutory Authority: Code of Ala. 1975, § 27-2-17. Consolidation Appropriations Act of 2022, § 1902(a)(25)(I).
Disclaimer: These regulations may not be the most recent version. Alabama may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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